23 June 2016 – bid approach/trading agreement
The company has revealed that it has received two unsolicited conditional bid approaches from US group McCormick & Co, both of which have been rejected as undervaluing the company. The first offer was at 52p per share last month whilst more recently a higher cash offer of 60p was made. The group has rejected both on the basis that the offers seriously undervalue the company. McCormick has until 20 April to make a bid or else it will have to walk away. At the same time the group has announced that it has secured an agreement with the Japanese group Nissin Foods. The latter has annual revenues of around US$3.8bn and invented the world’s first instant noodles in 1958. The company operates in 19 countries globally and as well as noodles it supplies chilled and frozen foods, cereal-based confectionery and yoghurt beverages. There are significant cross-selling opportunities and although shares in Premier have shot up as a result of the potential offer we regard the shares as a HOLD .